China stocks start positively, CSI300 gains 3,351.29pts, Shanghai Composite up 1.2%

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SHANGHAI: China stocks made highest start in more than 3-1/2 years on Tuesday, led by enduring expands in brokerages and communication firms.
China stocks rose to their highest level in more than 3-1/2 years on Tuesday, led by continuing gains in brokerages and infrastructure firms on views the current rally can keep going.
The CSI300 index rose 3.0 percent to 3,351.29 points at the end of the morning session, while the Shanghai Composite Index gained 1.2 percent to 3,057.74 points.
For both indexes, those levels were the highest since April 2011.
But Hong Kong investors have become cautious after the multi-week rally in mainland markets, with some locking in profits.
The Hang Seng index dropped 0.9 percent, to 23,827.37 points. The Hong Kong China Enterprises Index lost 1.2 percent, to 11,731.68 points.
In mainland markets, “blue-chip shares could continue to rise and start to correct by the year-end,” predicted Zhang Gang, an analyst in Shanghai at Central China Securities.
The brokerage sector remained strong. Hong Yuan Securities Co Ltd, CITIC Securities Co Ltd, Southwest Securities Co Ltd, Western Securities Co and Haitong Securities Co Ltd all climbed by the 10 percent daily limit.
The infrastructure sector also outperformed, with the CSI300 subindex soaring 5.5 percent on Tuesday.
In Hong Kong, the mainland rally was increasingly seen as a bit over-stretched, causing some investors to move to sectors such as infrastructure companies.
While some people in Hong Kong believe mainland markets can stay strong, “the risk has increased. Why not take some profits from Chinese financials?” said Alex Wong, director at Ample Finance Group in Hong Kong.
“Infraction shares still look cheap, and investors expect the policy (from the mainland) to drive earnings as China wants to boost infrastructures by developing more projects,” Wong said. (Reporting by Chen Yixin and Kazunori Takada; Editing by Richard Borsuk)